News Release

Deadly Combination: Nursing Homes and Wall Street During Pandemic


PATRICK WOODALL, via Carter Dougherty,,  @RealBankReform
Woodall is senior researcher at Americans for Financial Reform, which just put out the study: “The Deadly Combination of Nursing Homes and Private Equity During a Pandemic.”

Woodall said today: “The COVID-19 pandemic has ravaged nursing homes around the country and has highlighted the role played by Wall Street private equity firms in degrading care when it buys up facilities and cuts costs while reducing staffing, all to fatten the bottom line.

“Our new study study on this phenomenon reviews data from nursing homes in New Jersey during the height of the COVID-19 crisis. It found that 59 percent of private equity-affiliated nursing home residents contracted COVID-19 — an infection rate 25 percent higher than the state average and 57 percent higher than at public nursing homes. The resident COVID-19 fatality rate at private equity nursing homes was nearly 29 percent, more than 10 percent higher than the state average.

“Private equity firms raise money from pension funds, wealthy individuals, and endowments and use it to buy control of companies, often by saddling their takeover targets with a heavy debt load. These Wall Street behemoths now sit atop a cash pile of $3.9 trillion. Over the last decade, the industry’s growth has been marked by looting-like behavior in industries as diverse as retail, media, and health care.

“Extensive studies and reporting have revealed poorer quality of care at private equity-affiliated nursing homes in recent years. This study is the first to document the negative impact of private equity nursing homes during this deadly pandemic.

“The study concluded that the racial gap was especially pronounced at private equity facilities, with staff at private equity facilities seven times more likely to die working at nursing homes in counties where people of color make up the majority of the population than in 80 percent white counties. Residents were 9 percent more likely to die of COVID-19 in communities of color than in predominantly white areas.

“Private equity has always had a troubling record of degrading the care offered in nursing homes, but the quality issues during this pandemic can have particularly deadly consequences. The nation will have to come to grips with the often-poor treatment residents face in the nursing home business, with chronic understaffing, too little investment in facilities, and lax enforcement of regulations. But private equity’s business model of siphoning profits away from providing adequate care now appears especially deadly.”